Insolvent Insurance Carrier In a Work-Related Injury Case
In Luvine v. Workers' Compensation Appeal Board (Erisco Indus.), 881 A.2d 72 (Pa. Cmwlth. 2005), the claimant sought benefits from the employer for a work-place injury.
The employer insured its liability with an unnamed insurance carrier.
The insurance carrier became insolvent and, by operation of law, the Security Fund "succeeded in interest to employer's insolvent insurance carrier and was substituted for the insurance carrier in all subsequent proceedings." Luvine, 881 A.2d at 73.
The Workers' Compensation Judge (WCJ) and the Board initially denied the claimant benefits, but this Court, on appeal, reversed and awarded benefits.
Approximately one month after this Court's Order, the claimant filed a penalty petition against the Security Fund, arguing that thirty days had passed since the award of benefits, benefits had not been paid during that time, and that, under Section 435 of the Act, the claimant was entitled to benefits.
The WCJ granted the penalty petition against the Security Fund, and imposed a ten percent penalty as a result of the delay.
The WCJ also awarded the claimant counsel fees against the Security Fund because it was without a reasonable basis for contesting the petition.
On appeal, the Board reversed the WCJ's decision.
In doing so, it relied on the Chiconella decision.
The claimant appealed to this Court and the Court affirmed the Board.